Wednesday, August 23, 2006

July Existing Home Sales Decline

The National Association of Realtor's released its national existing home sales number for July 2006.

Nationally, sales of existing homes in July plunged 4.1% from June 2006 to a seasonally adjusted annualized rate of 6.33 million, the lowest since January 2004, the National Association of Realtors said Tuesday. Sales in July are down 11.2% compared to July 2005.

The inventory of unsold homes rose 3.2%, compared to June 06, to a record 3.856 million, a 7.3- month supply at the July sales rate, the highest since April 1993. This represents a 39.9% spike in inventory compared to July 2005.

The median sales price has risen 0.9% in the past year to $230,000. It matches June for the weakest price growth in 11 years. Prices fell on a year-over-year basis in the West and the Northeast.

David Lereah stated "Boom markets are cooling significantly." Cooling is an inappropriate euphemism. The housing market in the formerly boom markets are in an outright decline. The reality of a declining housing market is becoming ever more apparent each week.

87 comments:

  1. Like I have said in other posts. You can't look at median prices. You have to look at Comparable homes that have sold over time. Most folks can just look in their neighborhood and see that the prices have come down.

    I have seen about 10% drop in home values depending on the market.

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  2. Has Lereah had an epiphany and decided to level with the public. I wonder if he is ill and concerned for his salvation?

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  3. I thought I saw blood in the street, but it was only water from the lawn sprinkler

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  4. Yep, almost sounds like the days of "Soft Landings" have become "fragile"

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  5. waiting for godotAugust 23, 2006 10:55 AM

    www.NVAR.com is down. Are the numbers for the DC area out yet?

    ReplyDelete
  6. Oops, Lereah's epiphany was short-lived

    “‘Many potential home buyers have been on the sidelines, some ‘kicking the tires,’ but mostly waiting for sellers to compromise on prices and terms,’ he said. ‘Now sellers in many areas of the country are pricing to reflect current market realities. As a result, there could be some lift to home sales, but it’ll likely take some months for price appreciation to rise.’”

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  7. Shorter Lereah,

    "You're killing us! We need cheap, e-z no money down loans so the 80% of the population who's seen no increase in income since 1999 can get suckered in! Pleeeeezeeee! Realtors gotta eat too!"

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  8. Lereah at it again....His nose keeps growing with each new comment.

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  9. I may have bought the soft landing scenario before, but seeing what's happening in other markets, we're in for a doozy of a downturn.

    There's a WSJ article about a woman in Herndon who priced her 5 bd house based on last year's com sales at 1.1 million. It went at auction for $530K. The price that some 1 bd/den condos were going for in the District's hottest neighborhoods last year.

    If prices in the burbs on big houses truly fall that far, it has to affect District prices, even of condos, as the same-priced alternatives become more attractive to more people.

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  10. Here are David's two favorite people ;)

    David Lereah & ...

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  11. "I thought I saw blood in the street, but it was only water from the lawn sprinkler"

    What?

    The leak has just started.
    Any sprinkling is gonna start only
    next year.
    2008 is when you will see blood on
    the street.
    Watch out, it could be yours.

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  12. John said:
    "the 80% of the population who's seen no increase in income since 1999"

    I was wondering where you got this figure. It could very well be the case ... but am wondering if you have backup for it or if it is just speculation that that high a percentage have been squeezed out by "off-shoring" and other causes of the growing disparity between the haves and the have-nots in American society.

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  13. If I have some paper losses for awhile, I don't care. Rents will stay strong. Shelter is not a discretionary expenditure.

    Jobs may be affected and that could hurt you. Be careful of what you hope for. I have a guaranteed income.

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  14. anon said:
    "It went at auction for $530K."

    Like Va_Investor has mentioned several times, foreclosures (and other distress sales) don't give a good indication of what their surrounding area is doing. It's like your going in to a shop and buying a slightly damaged lamp in the clearance section. Just because it's been priced down 50% because they just need to get rid of it at a price that'll cover what they have in it, doesn't mean you'll be going to the regular shelves and getting the undamaged goods for 50% off too. And yes, a house in foreclosure is damaged goods because of all the extra effort involved in clearing the title and actually finalizing the sale (not to mention the fact that when you bid at the reduced amount, you do so knowing that only 1 in 100 foreclosures actually happen in the end.)

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  15. I would have paid 530K for that place. I don't think it was a foreclosure - just an auction.

    Still, it must have been a distress situation. If, in fact, it was let go for 530K.

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  16. Va_investor,
    Don't bother feeding the trolls.

    Lance,
    I don't think the woman in the article was a distress sale. She wanted to retire to Florida, I believe.

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  17. Fasten your seatbelts-its going to be a real rough ride folks.

    Many of us here who said a year ago this type of scenario would play out where right. We still have the GWB 'appointees' od Ben Bernanke and David Lereah telling us things would work out in their fantasy zone scenario called a 'soft landing'. SO SORRY I think not- how does deep economic morass sound?

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  18. "Be careful of what you hope for."

    It does'nt matter what I hope or wish for.

    It is what I think will happen.
    I wish there was no bubble in the first place.

    As far as rents, when economy tanks along with
    job losses. Dont be so sure.

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  19. "the 80% of the population who's seen no increase in income since 1999"

    I was wondering where you got this figure. It could very well be the case ... but am wondering if you have backup for it


    Lance,
    I think this may be a case of taking numbers out of context. It has been widely reported that while the upper middle class and the wealthy have been seeing income increases over the past five years or so, the middle as a whole has had no inflation-adjusted pay increase. The 80% number probably comes from the fact that researchers often divide income groups into quintiles. So it appears that John is saying that the top quintile has been gaining while the other quintiles have been stagnant, although the way John phrased it is almost certainly incorrect.

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  20. va_investor said...
    If I have some paper losses for awhile, I don't care. Rents will stay strong. Shelter is not a discretionary expenditure.

    Jobs may be affected and that could hurt you. Be careful of what you hope for. I have a guaranteed income.


    Don't be so sure. If even a fraction of the glut of property out there works its way into the rental market, we could see a scenario of falling rents and falling home prices.

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  21. Va_investor,

    Serious question.

    If a serious recession/depression occurs and one of your tenants comes to you and says, 'I have lost my job - I cannot afford my rent this month but certainly can't afford to move somewhere else' (security deposits etc.), what would you and your husband decide to do?

    I guess I am just feeling like real people are going to get hurt in all of this and your blazé 'my income is set' attitude seems callous.

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  22. Rent will increase once the investors stop dumping their homes they can't sell into the rental market.

    100% chance, rent will increase over the next 2 years.

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  23. It has been widely reported that while the upper middle class and the wealthy have been seeing income increases over the past five years or so, the middle as a whole has had no inflation-adjusted pay increase.

    I've had a ten-fold increase in pay in the last five years. Of course, I went from a part-time college student intern to graduated full-time employee, but still, I'm under 30 and make as much as the average household in N. Virginia. Not bad if I do say so myself.

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  24. anon said:
    "Don't be so sure. If even a fraction of the glut of property out there works its way into the rental market, we could see a scenario of falling rents and falling home prices."

    hmmm ... and what's going to happen to the people that were living in those properties converted from freehold to leasehold? do they just end up on the street not needing to rent?

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  25. Even if rents will increase as housing prices decrease, then buy REITs, not a house!

    Be a renter who didn't overpay for a house like a chump and be a landlord seeing your investment appreciate as rents rise.

    ReplyDelete
  26. hmmm ... and what's going to happen to the people that were living in those properties converted from freehold to leasehold? do they just end up on the street not needing to rent?

    I'm talking about all the houses for sale and the spec houses that builders are still building. These houses are unoccupied. If a large enough portion of those end up as rentals, this could create a glut on the rental market as well, depressing rents.

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  27. Lance, it was not a distress sale. It was an auction. She set the minimum at auction at $675, comps in the neighborhood sold last year for $750-800K.

    So she sold, without a foreclosure (she's been in the house a while, and I got the idea she may have owned it outright), for $250K less than a similar house in her neighborhood last year.

    Go ahead, spin this to not reflect falling prices.

    What do you get out of denying reality? I thought you were immune to falling prices due to your pride in homeownership and not having to deal with a landlord?

    Really, it's like saying that the ground is up and the sky is down, I can somewhat understand this kind of delusion in a romantic situation, but when cold hard numbers and facts hit you in the face?

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  28. anon 10:23,

    I was responding to someone (anon, nach.)who was hoping to see my blood flow.

    In answer to your question, we have had several situations over the years where we have lowered rent, allowed tenants to use
    security deposits for rent, and even suspended rent for a period of time.

    The only times I have terminated a lease is when I have sold property.

    Consider whether you would act the same.

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  29. "and what's going to happen to the people that were living in those properties converted from freehold to leasehold?"

    That is indeed a real possibility.

    You could start seeing migration out of the US.
    A lot of people who immigrated just for the "Economy"
    could move back to their native countries. (They wont
    be taking any homes back with them.)

    You could see internal migration. People moving from high
    housing cost areas to areas with cheaper housing ( read Danville, IL).
    It has actually been happening for a while now. People moving out
    of California and the North East.

    You could see compaction, More people sharing a unit to split
    the rental/housing costs. Per unit occupancy could rise.

    Some may have to move back in with a family member.

    The multiplier effect will start to work in the reverse.

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  30. "If I have some paper losses for awhile, I don't care. Rents will stay strong. Shelter is not a discretionary expenditure.

    Jobs may be affected and that could hurt you. Be careful of what you hope for. I have a guaranteed income."

    Don't be so sure. If even a fraction of the glut of property out there works its way into the rental market, we could see a scenario of falling rents and falling home prices.


    Sorry, I'm a bubblehead, but va_investor is right on this one. Rents aren't going to fall. DC area rents will probably keep rising at roughly 5% per year (which is about the long-term appreciation rate of pre-bubble era DC area housing). As long as he has positive free cash flow, the sales prices of housing shouldn't affect his income.

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  31. anon 10:38,

    She sure sounds distressed to me. She had to have some urgency to "dump" the property or, else, 250K does not matter to her. One or the other.

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  32. Va-investor,

    You sound like a sweet little ol' landlady. Can I rent from you?

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  33. deceptive as usual for the NAR. why do they quote some stats as Y-O-Y and some as M-O-M ? the inventory is the issue, always has been and always will be. btw, 53,000 and some change here in phoenix. look out for the Y-O-Y price declines, as they are around the corner.

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  34. "I was responding to someone (anon, nach.)who was hoping to see my blood flow."

    I am not hoping to see your blood flow. I am just warning.


    "In answer to your question, we have had several situations over the years where
    we have lowered rent, allowed tenants to use security deposits for rent, and even
    suspended rent for a period of time.
    "

    Thatz awfully nice of you.
    Then the question is how much and for how long you can take this kind of hit.
    So you do admit that rental income may not be as strong a propositon you
    mentioned earlier.

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  35. "You could see compaction, More people sharing a unit to split
    the rental/housing costs. Per unit occupancy could rise.

    Some may have to move back in with a family member."

    That is a very real scenario that I've seen first hand. In all the high cost rental markets I've been in, I've always known many people that share apartments, etc. When the dot coms went under, I personally knew many 30 somethings that had to go back and live with mom and dad because the economy was so bad.

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  36. anon 10:49,

    I have been a landlord for almost 25 yrs and never have vacancies. I can "afford" to have all my properties vacant indefinitely, but rents are, and will remain, strong.

    Don't mistake my personal choices on debt collection as a sign of a weak rental market. In the 90's people used to line-up to view my rentals. I expect the same were I to have a vacancy now.

    My guaranteed income is from another source.

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  37. Va-investor,

    You sound like a sweet little ol' landlady. Can I rent from you?


    This is actually a good point. This blog is filled with renters, but va_investor doesn't try to convince anyone to rent from him. Where are your buildings, va_investor?

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  38. "I have been a landlord for almost 25 yrs."

    You will still be ok in 2006.

    You have'nt been a landlord in the times
    starting 2007-2008.( or in the 1930's)

    I do wish you well.

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  39. james,

    You guys sound like a bunch of malcontents - I like meek, passive, long-term tenants! I think most of you, if not all, want to buy in the near future. I like lifer's.

    Anyway, I have no vacancies. Properties are in VA., MA., and FL.

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  40. anon 11:08,

    What do you think the ramifications of another Great Depression will be on renters? That they will fare better than property owners?

    Is it only Real Estate that will tank?

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  41. I like meek, passive, long-term tenants! I think most of you, if not all, want to buy in the near future. I like lifer's.

    So are you a slum lord or something? The only people I can think of who will never buy a home are the poorest of the poor.

    Properties are in VA., MA., and FL.

    Didn't they teach you in real estate investment school that it's difficult to manage properties in different states?

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  42. From the Washington Post:

    "It's worse than I thought," said David Lereah, chief economist of the Realtors' group. "The housing markets are fragile."

    full article here: http://www.washingtonpost.com/wp-dyn/content/article/2006/08/23/AR2006082300551.html

    I love the blog and have been reading it for a while. this is my 1st comment. As a renter hoping to be a 1st time condo-owner in DC, your blog has put to words what I believed was happening last year as I looked for places. I'm glad I'm still holding out...

    PLS

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  43. "I love the blog and have been reading it for a while. this is my 1st comment."

    Thanks. Glad you posted!

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  44. I wonder which housinghead will be the first to cheap-shot or or speak in condescending tones to PLS. Oh heck, there's so much to choose from.

    Investor: "We landlords love suckers like you."

    Lance: "You will never afford a house, because you're a loser."

    Troll: "You're owned, here's a lame porn link. You live with your mother."

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  45. "The only people I can think of who will never buy a home are the poorest of the poor."

    Not true James. I have no low-income tenants (ie section 8). I have nice places ranging in value from 350k to over 2 million.

    The out of state properties have had the same tenants for at least 6 years, so far. I have a place in florida very close to my rentals.

    And, no, I never went to investment school.

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  46. "You could see compaction, More people sharing a unit to split
    the rental/housing costs. Per unit occupancy could rise."


    Could some of the 5BR houses out Herndon way eventually become apartments, like the big old Victorians in DC proper?

    Seriously.

    If Metro service to Dulles becomes a reality, and falling property values cause some rethinking of zoning regs., it's not that far-fetched.

    (OK half-seriously, but I doubt the original owners of those Logan Circle mansions never imagined what they'd become.)

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  47. I meant "ever imagined"

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  48. "What do you think the ramifications of another Great Depression will be on renters?
    That they will fare better than property owners?"


    The prospect of job losses for renters and landlords would be the same.

    Given that similarity, an owner with 300K upside down on a house
    would be much worse.

    And yes, I dont think I am immune to an economic depression.

    But still, will be better off not having a 300K debt.

    Somebody who is raising livestock today, will very likely be employed.
    But a programmer may not be.
    A programer with a 300K debt will be worse off.

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  49. So how do you think this will play out?

    The one thing I give the "bubbleheads" credit for is they generally have decent, substantiated arguments. But with "softlanders", I haven't heard or read or at least been exposed to their explanation of how the market will correct and take care of the imbalances specifically.

    It doesn't seem unreasonable to me that although the negative predictions may be "off the mark" in close timing, it seems very plausible that the predictions are inevitable.

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  50. Can anyone describe what the mortage market is like right now? I see a few IO loan ads on TV, many fewer than a year ago, but they are still pitching the things.

    thanks

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  51. The only times I have terminated a lease is when I have sold property.

    Consider whether you would act the same.


    Of course I would do the same. Don't be insulting. It is actually one of the reasons why I choose not to be a landlord - I don't want to be put in this type of a situation.

    The coming recession will hit many people hard. You may end up with with negative cash-flow properties once again. Morally, you may figure that this is all right since 'helping people' is the price you will pay. But it is a financial risk that you take on.

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  52. "Could some of the 5BR houses out Herndon way eventually become apartments, like the big old Victorians in DC proper? "

    I don't know about DC, but in the NYC area, there are enormous, beautiful homes that have been converted to rentals and multi-fams over the years. Certain areas of Brooklyn are like this, lower Westchester, etc. Go out to those places and you will see really beautiful big homes that are now multi-families b/c things happened to change the neighborhoods.

    I'm not saying it's a bad thing, just that it can happen. Although here, we're talking "real" houses made of brick and stone - not McMansions. These places are well built architectural beauties that are now becoming popular with the young and wealthy who renovate them and use the renters to cover part of the mortgage (there's no such thing as a 500K home in the NYC surrounds anymore).

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  53. Life is full of risks. No risk, no reward.

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  54. WSJ front page - not to kind to VA investors and speulators. LOOK OUT BELOW!!!

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  55. Thanks for the concern crispy! Just make sure the (rent) check is in the mail.

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  56. I have been a landlord for almost 25 yrs and never have vacancies.

    Come on now. At least be honest. If you have been a landlord for 25 years, you have had a vacancy at some point.

    And as VA investor pointed out once before - until she and her husband started putting 30% equity into their places, they were not breaking even. That means until they put down $99K for every $300K property they bought, they did not make $.

    Also, as a landlord, it is well-known that SFH are the worst real estate investment you can make - mainly because of the maintenance costs AND the fact that if you lose your renter you lose the entire payment, as opposed to a duplex, or small apartment building where you can spread your 'risk' among more renters.

    Just because after 25 years someone is finally cash-flow positive does not mean that they did not lose thousands or hundreds of thousands in opportunity costs that could have been spent on better investments.

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  57. BAHAHAHA. I will be in NY on business in October. Maybe I will look you up when I get on the east coast. I will request a layover in Va.

    I think if I look under - "Richest Woman in Va" - I can find the address.

    See you in Oct. I will be the guy knocking on your door with some HUMBLE pie for you!!

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  58. "Life is full of risks. No risk, no reward."

    There is a difference between knowingly walking into a mine field, and to have
    accidentally tripped on one.

    There is a five letter word for the former, that rhymes with "lucid".

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  59. Better investments such as? The tenants have paid-off millions in mortgage debt. Appreciation has been millions more. Now all I see is a large stream of cash coming in foreever.

    I don't claim it is the absolute best investment. I don't claim to be Warren Buffet either. It has been good for me.

    I know what opportunity cost is. Do you understand the concept of leverage and having others (tenants) pay off your debts?

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  60. "Could some of the 5BR houses out Herndon way eventually become apartments, like the big old Victorians in DC proper? "

    This isn't something that an owner can do without approval from the local government. It is called "Zoning" and it is enforced - especially in DC and the close-in 'burbs. I'm certain that all the local zoning bodies have websites where you can confirm this.

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  61. "Could some of the 5BR houses out Herndon way eventually become apartments, like the big old Victorians in DC proper? "

    This isn't something that an owner can do without approval from the local government. It is called "Zoning" and it is enforced - especially in DC and the close-in 'burbs. I'm certain that all the local zoning bodies have websites where you can confirm this.

    ReplyDelete
  62. "Also, as a landlord, it is well-known that SFH are the worst real estate investment you can make"

    I've read this, but I've also read this which convincingly makes the opposite argument.

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  63. "Do you understand the concept of leverage and having others (tenants) pay off your debts?"

    Or you could say the renters passed on the risk of owning a bubble asset to the landlords.

    ReplyDelete
  64. I was walking down the street today, and noticed that there was blood everywhere. Yep, you guys were right: "Blood in the streets"

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  65. I can't wait to see the New Home Sales Data to be released tommorrow.

    Should be just as interesing as today's.

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  66. Net population declines in the US due to outbound population migration? Society as you've come to know it has ended. Hope you brushed up on your "Mad Max" movies.

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  67. If someone was successful in predicting the market, he/she would not have purchased in 2005 or 2006 and you would be correct about passing risks on to landlords.

    Unfortunately, that was probably dumb luck or simple unaffordability. People don't have crystal balls. If they did, would they not have purchased in 2001 or 2002?

    If you can time the market - go for it.

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  68. A crystal ball is a poor substitute for common sense.

    Even if you profited from dumb luck, it would still be wise to lock in some of the profits.

    Or at least spread your risks by off loading at least the MA property.
    That is one market not just overheated, but also has been seeing a significant out migration / population loss for a several years.

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  69. anon 1:25,

    The transaction costs make selling unattractive to me. I am in it for the rents and will probably leave all the property to my son.

    You see, we have other assets and have no need to sell anything. Long term, Real Estate is as good an investment as anything else.

    Where would you put your money today, tommorrow, 20 years from now?

    ReplyDelete
  70. va_investor.

    OK. Hold on to your thoughts and your properties.

    And where to invest your money, would be an investment advice, which I don't give for free.

    Anyway...

    ReplyDelete
  71. anon 1:43,

    Very enlightening response. Do you give your roommates free financial advice?

    ReplyDelete
  72. VA Investor,

    That last was pretty funny. Kudos!

    My $0.02.

    ReplyDelete
  73. "Very enlightening response. Do you give your roommates free financial advice?"

    No. I dont.
    No roommates either.

    ReplyDelete
  74. If someone was successful in predicting the market, he/she would not have purchased in 2005 or 2006 and you would be correct about passing risks on to landlords.

    Unfortunately, that was probably dumb luck or simple unaffordability. People don't have crystal balls. If they did, would they not have purchased in 2001 or 2002?

    If you can time the market - go for it.


    I knew in '05 that we were at the peak of the bubble.

    I could not have purchased in '01 because I was in college still and purchasing a house was the last thing on my mind at that time. I graduated in '03, accepted a job in DC in '04, and really started to follow the local RE market by fall '04. By fall '04, the market was obviously (to me, at least) priced beyond what was reasonable, and I knew something was wrong. Even though I could afford to buy something, I was not happy with what my money would get me.

    ReplyDelete
  75. But have certainly talked out most of my friends
    from buying homes, since the time I figured out this was a bubble.

    ReplyDelete
  76. Anonymous 1:54,

    Your experience parallels that of a lot of "bubbleheads." I think some housingheads blame you for not being 2 or 3 years older and that is why you will never reap the rewards of the vast run up in property prices.

    I don't accept this. Over the course of a generation or a decade of change, perhaps an equivalent graduate earning an equivalent high end starting salary may not be able to afford the same house/condo/lifestyle as those before them. But over the course of 2-3 years? No way.

    The market has certainly been chaotic and it will come back in line so that the average experience at all ends of the salary spectrum can expect to have what those before them had. Minus the longer term trends and changes.

    Does that make sense? Seems clear as mud to me. :)

    My $0.02.

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  77. The transaction costs make selling unattractive to me.

    One of the rules of successful investing is to minimize taxes and transaction costs. If va_investor has enough positive free cash flow, it may make little sense for him to sell.

    Where would you put your money today, tommorrow, 20 years from now?

    20 years? Who knows? It depends on valuations.

    Buy today...
    Large-cap stocks
    Foreign developed-market stocks
    Short-term bonds

    Avoid today
    Real estate (overpriced)
    Small-cap stocks (overpriced)
    Emerging market stocks (overpriced)
    Long-term bonds (flat yield curve)

    ReplyDelete
  78. Anonymous said...
    But have certainly talked out most of my friends
    from buying homes, since the time I figured out this was a bubble.


    Actually, since I make more than any of my friends, purchasing for them is not even an option. I don't have to talk them out of anything.

    ReplyDelete
  79. If you're referring to me, I'm not David. Then again, who is "David"? David could be a girl. You could be David posting anonymously. I could be an employee at the Federal Reserve that doesn't want to reveal his identity. You could be a child molestor. Isn't the anonymity of the Internet great? Maybe there's a reason people post anonymously. Hmmmm..... let the deep thoughts ensue....

    ReplyDelete
  80. HA HA! You're so mysterious. Tall dark and handsome in your own estimation, too?

    We all know "DAVID" is an acronym for the "slime fighting"* team that sits around in their group house rental while wearing capes and tights. They decide which hyperbolic terms to use for that days post; then they dash off to the Blog Mobile.

    *(my term; Do not use without my express permission.)

    ReplyDelete
  81. Same crap - only its getting deeper and thicker. Stop by and vent at the home of the Sunshine State bubble....

    Florida - Paradise Lost

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  82. You missed one

    http://www.washingtonpost.com/wp-dyn/content/article/2006/08/22/AR2006082201345.html

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  83. Looks like I was edited. I am a bear and I was edited. Oh well. I hope this blog goes under!

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  84. Getting started in rental real estate can be difficult, but over several decades, it can work out pretty well. va_investor seems to have done that.

    But make no mistake about it, a recession is very likely. There will be blood in the streets, but not all of the streets. Not sure yet how DC will fare -- the last recession was a cakewalk for DC. Florida and California will be whacked very, very hard.

    Another sign of an impending recession: new US vehicle sales are now down 2.5% from last year. The US had a recession every time since 1970 when this has occurred.

    P.S.: I am a financial analyst and I cover the big US automakers, and many other companies.

    ReplyDelete
  85. chris g,

    Interesting info on the auto sales/ recession correlation

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  86. hey va investor-i would think twice before spoiling your kid by giving him the silver spoon to feed from. i went to college and then to med school with so many friggin spoiled brats whose parents bought them their condos while we were in school. spoiled rich kids are brats. period. they would all brag about how they "owned" their houses-like they were better than anyone who rented. for christ sake, the rest of us were $250K in debt going to ivy league med schools. and NO, i am not jealous so don't anyone say it-maybe i was when i was 19, but i am very happy that i didn't turn out like they are now. i bought my own place while i was still in college and then sold it last year to pay off my med school debt. i would have felt bad selling (ripping the seller off??) with my two bedroom boston condo for $650K except that i was selling it to some moron who was buying it for their 33 year old daughter so i didn't feel so bad. get a life-get a job, buy your own house. bottom line is, i have gone to school with lots of rich kids and about 95% of them are spoiled rotten. and they are all intolerable snobs. funny thing is that my dad is loaded, but wouldn't pay a dime for me after college. he thought i should learn about the world myself. don't spoil your kid with million dollar houses when he is 25-you'll ruin him.

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  87. anon 5:48,

    Appreciate the advice. I,too, went to an Ivy League school with a bunch of rich preppies. After school was paid for, I put myself thru law school at night= so I know where you are coming from.

    We probably will give him a condo or house to help him get started. We would have been so far ahead if someone had laid some cash on us in our early 20's. we are not snobs and neither is he.

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